In its second merger-control ruling ever, the Competition Commission of India (CCI) approved Disney's proposal to buy out UTV.
Disney's Singapore-based subsidiary filed the application to acquire all of the publicly-listed UTV Software Communications Limited. The acquisition can now proceed with Disney first acquiring the publicly held shares in UTV through a delisting offer. Following succesful delisting, Disney proposes to acquire the UTV promoter group's shares.
The CCI's ruling appears to have been primarily based on a finding that there is already intense competition in the areas where the combined business operates, i.e., motion pictures, entertainment television, interactive media and character merchandising. Given the ability to access content across multiple platforms, the business is demand driven, each area allows relatively easy entry and exit and as a result, the CCI concluded, there is a low likelihood of coordinated exclusionary behaviour. (The CCI's decision was also influenced by Disney's existing majority stake in UTV and the extensive regulatory oversight of television broadcasting in India.)
Like its first merger-control ruling, this CCI ruling was delivered within a month of the application being made—further allaying fears that the CCI's procedures might unduly delay transactions.